Medical cartels an early response to natural medicine

This is part of a series on the history of health care, originally published on the geke account on Steemit, exploring how and why health care costs in the US have risen beyond the levels a free market would normally bear. In light of the 2020 viral pandemic, a better and clearer understanding of the structure of our modern healthcare system is necessary.

If you were pregnant in Charlottesville, Virginia in 1848, according to the “Fee Bill” below, it looks like you would only pay $20 for a doctor to deliver your baby. And if your husband broke his arm, it would only cost $10 for a doctor to set his fracture. Even accounting for inflation, 1848 healthcare costs seem insanely cheap!

But to give some context… let’s imagine that John is a bricklayer who earns the 1848 bricklayer average of $36 a month. He and his young wife, Sally, live on the east coast of the United States. They pay 8 cents for a loaf of bread, 25 cents for a pound of butter, and another 25 cents for a bag of potatoes. In 1848, a train ticket from New York City to Philadelphia costs $4 and a year of college, about $100. 1

In light of these average wages and costs from the mid 1800s, a $20 fee to deliver a baby is still somewhat expensive; it equates to about three weeks’ work for John. It’s likely a young family like this would have just hired a midwife at a much lower cost. But it’s worth asking: were medical expenses more fair in the 1800s than they are today?

Not necessarily, and the newspaper clipping above is a great example of an attempt to keep medical costs high. That Fee Bill isn’t a price list; it’s a form of price fixing that’s also intended to call the reputation of natural healers into question.

Fee Bills were often published in newspapers in the 19th century. The general public may have assumed a bill like the one above was a simple price list, but if you read the fine print more closely it’s clear that this was the work of a medical cartel:

“We, physicians, practising in Charlottesville, mutually agree to charge and require fees not less than the following, in the cases hereinafter specified.”

A “cartel” is defined by Oxford as “an association of manufacturers or suppliers with the purpose of maintaining prices at a high level and restricting competition.” And that’s exactly what these doctors were up to: they were printing a list of minimum prices that the undersigned doctors promised not to undercut. Ultimately, they were agreeing not to compete with each other and this agreement kept the medical costs in Charlottesville higher than the market would normally bear.

Customers in any market rely on healthy competition between sellers and producers because that competition is what keeps prices down. In the case of the 1848 Charlottesville healthcare market, one doctor might to decide to charge less to attract more patients. This would force other doctors in that market to charge less, too, in order to keep their current patients. That’s how competition works, and the Charlottesville physicians of 1848 were having none of it.

They didn’t want to compete with one another. They wanted to collude with one another to keep prices artificially high.

To add insult to injury, the published Fee Bill above didn’t prohibit any of the doctors from charging more. And it’s likely that when Sally went into labor, she and John would have paid more than $20 if they chose a doctor instead of a midwife.

So why did people like John and Sally put up with these shenanigans? Because doctors had convinced them that these shenanigans actually protected consumers.

Allopathic doctors (called “regulars” back then) were also facing competition from natural healers like herbalists and homeopaths. Trying to reduce that competition, they sought to denigrate natural medicine, much like we see today. And according to journalist Todd Savitt, “Naming the physicians who signed the fee bill served to advertise to the population who among local healers were the trained, respectable physicians and who were the low-cost (and, according to the regulars, presumably less competent) healers – the irregulars and quacks. Patients were thus ‘protected’ from unscrupulous practitioners.”

The implication here was that “regular” doctors were the only respectable providers — because they charged more — and that anybody charging less for medical services was surely a quack.

Just like today, people in the 1848 healthcare industry were looking for ways to kill their competition. They were putting out forms of propaganda denigrating their competition in newspapers and forming cartels with the competition (fellow doctors) they couldn’t bring down: if ya can’t beat ’em, join ’em.

Eventually this problem was “solved” with government regulation, but as usual, government interference didn’t really solve anything. Regulations merely defined who was allowed to collude and price fix… and who wasn’t.

Above all, the doctors’ attempts to rig the healthcare industry were explained away as patient protection… much like today. For example, why are such reliable and natural treatments for viral infections like covid-19, including zinc, vitamin D, high-dose vitamin C, denigrated by the healthcare industry? Because natural treatments aren’t patentable and threaten the financial stability of the pharmaceutical industry.

Other posts in this series will show that healthcare providers have found many ways, over the last century, to rig the industry, eliminate competition, and keep healthcare costs high.

1. 1848 prices and wages sourced from:

Harvard’s new president was former member of Obama education initiative

Harvard University is given millions of dollars in public funding every year, which has made the school a legitimate target of investigation by the Justice Department in light of allegations of admissions discimination. In fact, Harvard is facing suits not only by the Justice Department, but also an organization called Students for Fair Admissions and a coalition of many Asian-American groups.

But rather than simply comply with both demands to see admissions records and to obey the law, Harvard has obfuscated, fought back, and continued an institution-wide attitude of entitlement. Its in-house lobbyists ramp up their efforts during “appropriations season.” Last year, Harvard lobbyist Paul Andrew admitted that even the school’s president was active in her attempts to influence Washington lawmakers: “That was why it was important for President Faust to be in Washington early in the year, understanding that the FY17 budget was still in play and she wanted to make a forceful case for the partnership and for research funding.”


Drew Faust is no longer Harvard’s president; she stepped down just last month. But while in that position she was known to meet with lawmakers often. Faust met several times with Massachusetts Representative Niki Tsongas and is a longtime friend of Massachusetts Senator Ed Markey.


Faust seems to do a lot of unregistered lobbying, as its own *Crimson* publication reported: “On a rainy April afternoon, Faust steps out of a black Cadillac Escalade and into the Dirksen Senate Office Building for an appointment. Earlier that morning, she had made the case for government support of higher education at the Economic Club of Washington, D.C., and now she was headed to meet with lawmakers to make that same argument.”

Harvard’s focus of late has been its tax-exempt status and humanities funding, both of which have been called into question. Because of this focus, members of the school’s in-house lobbying corps are chosen for their connections to Capitol Hill. Suzanne Day, for example, was involved in reauthorizing the Higher Education Act twice when she worked in Washington.

Harvard’s desired connection to government was best articulated by Faust, herself: “There were certain assumptions that the federal government and universities together would be the bedrock of discovery in the United States.” Not surprisingly, the incoming president, Lawrence Bacow, was a member of the Obama White House, appointed to the Initiative on Historically Black Colleges and Universities.

*IHBCU = Initiative on Historically Black Colleges and Universities*

GekeVenn: SAIC

SAIC (Science Applications International Corporation) is an intelligence technology defense contractor based in Reston, Virginia. Part of the company was spun off in 2013 and is now known as Leidos.

SAIC is probably best known for defrauding New York City out of $600 million. SAIC was originally awarded a $63 million contract for its CityTime payroll systems. But as has been pointed out many times in the “How Much Did the Military Spend Yesterday?” series, these contracts are often subject to “modifications” that increase the low bid that originally won the contract. So what was originally a $63 million contract grew into a $700 million fraudulent cost overrun.

SAIC’s most recent contract was awarded by the Navy just two days ago, on August 9, for “production and delivery of integrated command, control, communications, computers, intelligence, surveillance, and reconnaissance systems, networks and support equipment.”

Note that in-house lobbyist Andy Jazwick served as a senior military legislative assistant for three US senators on the Armed Services Committee and its subcommittees for defense, energy and foreign operations appropriations.


GekeVenn: MAERSK

A few days ago, Maersk Line Limited was awarded a Defense Department contract worth $14 million to continue work on military watercraft in Japan. The Danish company’s relationship with the United States federal government is supported by several well-connected Washington lobbyists.

But its lobbyists do far more than grease procurement for the company. They continue to ensure funding for the Maritime Security Program which benefits large shipping companies like Maersk.

The most difficult issue Maersk deals with is the reaction of environmentalists to its shipbreaking (beaching end-of-life ships). Although the company enjoyed the esteem of European environmental and human rights groups in the past, 2016 brought criticism as it stopped its progressive ship recycling policy to instead sell scrap ships to beaching yards.

This method of ship scrapping is banned in the US and Europe, but Maersk has also been actively lobbying for its acceptance.